Senators want halt to ag program cuts

U.S. negotiators should refrain from trading more cuts in domestic farm programs for a Doha Round agreement that offers little increased market access for U.S. agricultural products, a majority of the U.S. Senate says.

The Bush administration is on record opposing such a move, but reports say the subject has arisen again as the U.S. Trade Representative tried to help revive the stalled World Trade Organization talks. The reports prompted a bipartisan group of 58 senators to sign a letter urging the White House to reject such a proposal.

“We cannot support a deal that directly reduces new farm income through steep cuts in farm programs in return for minimal market access gains whose effect on farm gate receipts would be speculative at the best,” according to the April 16 letter, written by Sen. Kent Conrad, D-N.D.

Disagreements over market access, one of the three “pillars” of the Doha negotiations, led to the suspension of the Round in Geneva, Switzerland, last summer. Administration officials had proposed a 60-percent reduction in U.S. farm subsidies, but the European Union and India refused to make more than token reductions in trade barriers.

Democrats signing the letter said the administration must revisit its trade policies while Republicans said it must insist that trade flow both ways and that farmers and ranchers not be blocked from participating in world markets.

“This nation’s trade policy has us on the road to retreat,” said Conrad, chairman of the Senate Budget Committee, in a press release. “American trade negotiators appear willing to trade away the future of American farm and ranch families.”

Conrad said the 58 senators were sending a clear message to the White House that a majority of U.S. senators “is opposed to their plan.” House Agriculture Committee Chairman Collin Peterson also said he has concerns about the issue.

“I’ve said many times that no deal at Doha is better than a bad deal for America’s ranchers and farmers,” said Sen. Max Baucus, D-Mont. “The Senate is speaking forcefully today against any conclusion that fails to promote the survival and success of U.S. ranches and farms through the export of our agricultural products.”

“Free trade is not a one-way street,” said Sen. Pete Domenici, R-N.M., another signee, “and the administration and our trade negotiators must ensure that our American farmers and ranchers are given a fair chance at competing.”

The senators, who must ratify any trade agreement, wrote that their support for an agriculture trade agreement will depend on whether it offers net gains for U.S. agriculture in relation to reductions in trade-distorting domestic support.

“The consensus among economists is that reducing agriculture market access barriers generates far greater economic gains than cutting domestic support,” the senators wrote. “As a result, it is imperative that our trading partners dismantle barriers to imports if the Doha Round is to achieve a successful conclusion that will benefit not only U.S. agriculture but also the global economy and people around the world.”

Agriculture Secretary Mike Johanns has said U.S. negotiators could do some “very creative things” with domestic price supports if other countries become more accommodating on market access.

In an April 10 speech at a conference sponsored by Informa Economics, Johanns said current U.S. farm programs “have come under nearly constant attack in WTO cases, such as those brought by Brazil against the U.S. cotton program and Canada against U.S. corn subsidies.

“U.S. policies are WTO-compliant,” he said, adding that the United States will defend its programs. “But it just makes sense that we have better trade policies.”

House ag committee chairman Peterson said U.S. Trade Representative Susan Schwab and Deputy USTR Richard Crowder told him in a meeting April 18 that they are seeing “small signs of encouragement” in the negotiations.

“I’m not sure why they think that because I’m not seeing much movement,” he said. “I’ve said before that I believe the Doha Development Round concept is fatally flawed because so many of the so-called developing countries are, in fact, developed and are our competitors. They’re subsidizing their farmers more than we are.

“If they continue the course they’ve been following, what they end up with won’t pass Congress anyway.”